Heaton Corp. sells on terms that allow customers 45 days to pay for merchandise. Its sales last year were dollar 425,000, and its year-end receivables were dollar 60,000. If its DSO is less than the 45-day credit period, then customers are paying on time. Otherwise, they are paying late. By how much are customers paying early or late?

Heaton Corp. sells on terms that allow customers 45 days to pay for merchandise. Its sales last year were dollar 425,000, and its year-end receivables were dollar 60,000. If its DSO is less than the 45-day credit period, then customers are paying on time. Otherwise, they are paying late. By how much are customers paying early or late?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter21: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 8P: If a firm buys on terms of 3/15, net 45, but actually pays on the 20th day and still takes the...

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